Venezuela, and why Gold and Barter Items are Terrible Preps

Empty shelves in Venezuela. Source: DailyMail.

Empty shelves in Venezuela. Source: DailyMail.

Like most preppers, I’ve been following the ongoing collapse in Venezuela with great interest, under the assumption that at some point we’ll have our own version of that here in the States. One of the most amazing things to me is how in all of the videos it’s like Black Friday everywhere all the time, with people clawing past each other to get at those stacks of gold bars and silver coins. Er, wait, that’s not how it’s going down, at all.

People are shooting each other in the streets over food–not ammo, cigarettes, liquor, gold coins, silver coins, or any of the other crap that preppers love to stockpile “for barter when TSHTF.” That’s right, it turns out that good old-fashioned food is the only thing that you can actually eat in a collapse, and as worthless as the Venezuelan bolivar is right now, “sound money” is pretty much totally absent from all the discussions I’ve read of what the average Venezuelan is desperately worried about scoring when he wakes up every morning.

As for the Venezuelans who are “holding physical,” as the goldbugs like to say, the only thing they could possibly exchange that stuff for are bolivars, given the very tight currency controls that the country is under right now. They won’t be getting USD for it, and they certainly aren’t going to trade it for food because, again, there is no food.

In a collapse, food is scarce and people are hungry. Nobody is going to trade you a box of .357 or a Gold Eagle for a chicken, because unlike the latter two things, chickens are edible, and the edible stuff takes priority.

I get why preppers like these “barter item” type preps. It’s because you can accumulate them in small increments, and you can fantasize that you’re buying low and you’ll “sell high” when the time comes. It’s old-fashioned speculation, something that has universal appeal to the gambler in us. But like all other speculation, it’s dangerous and there are way better vehicles for accumulating real value.

(Note that I think gold definitely has its place in any portfolio, but as a form of insurance, not as speculation.)

As the Venezuelan collapse amply illustrates, you need to have your priorities straight, and a dependable source of calories should be at the very top of the list. Don’t get suckered into wasting money, time, and space on stuff you can’t consume but that you think someone will trade you a bit of their food for, because you’re certain to be gravely disappointed.


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